Riding The Gravy Train

Beating the market is fun and profitable. This is how we do it.

Thursday, September 22, 2016

Junk Bonds Chart, JNK, SJB Update

 
Here's a chart of junk bonds, as per JNK:


JNK is "the SPDR Barclays High Yield Bond ETF tracks a market-weighted index of highly liquid, high-yield U.S. dollar-denominated corporate bonds."

In the chart above, we see that JNK is up against a long-term downtrend (in black) and it looks like it'll collapse once the current uptrend (in red) is broken.

SJB is "the ProShares Short High Yield ETF provides inverse exposure, reset daily, to a modified market-value-weighted index comprising US-dollar-denominated corporate high-yield bonds with maturities between 3 and 15 years."

Earlier this month we noted that SJB had broken a 7-month downtrend at that we had entered a long position in SJB (effectively shorting junk bonds).

In the chart below, we see what could be support for SJB (in black) and the former downtrend likely broken (in green):


Typically a chart like this one resolves upward, and for us it's not a question of "if" junk bonds will collapse and SJB skyrocket.  As for when that'll happen, it's anyone's guess but to us the current setup in equities, in bonds (see recent TBT chart and commentary within the previous link) and in junk bonds looks very good. 

We remain long TBT and SJB as previously diarized, in order to effectively short bonds and junk bonds, with no stop levels in mind as of yet.  We'd be more likely to add considerably rather than sell at a loss if these drop materially. 



 
 
 
 
 
 


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.

To be notified when this blog is updated :
Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.


Japanese Yen, YCS and UCO Update

 
Here's a look at the Japanese yen, running up against resistance of the past three years:



YCS is the ProShares UltraShort Yen ETF, which provides a 2x inverse multiple to the daily performance of the yen spot price against the US dollar as measured by Reuters. 

We'll buy YCS if it rises to $60.10 or above, and if we end up holding it we'll place a stop-loss at $58.90 in an attempt to limit risk to roughly 2% while the upside is considerably greater. 

YCS last traded at $59.50

We've entered UCO at $9.19, per our previous posting.  Pending future updates, we'll close out the position should Crude Oil WTI trade below $39




 
 
 
 
 


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.

To be notified when this blog is updated :
Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained in herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.


Tuesday, September 20, 2016

Buying Oil Again, via UCO

 
Oil is in the late stages of a pattern that could resolve either way. 



The probable mini-mania after tomorrow's Bank Of Japan and U.S. Federal Reserve announcements could be the catalyst for a move in the US dollar and commodities in one direction or the other for some days or weeks to come. 

Since the world seems ultra-bearish on oil at the moment, and we've done so well on oil and gold this year betting against mass sentiment, we're buying back our UCO position which we sold in June for gains of over 100% from our purchase price in January.

We'll buy UCO, the ProShares Ultra Bloomberg Crude Oil ETF, which provides 2x the daily return of an index that measures the performance of crude oil as reflected through futures contracts of WTI crude, if it trades above $9.10 

If we enter the position, we'll set out of it for a loss should Crude Oil WTI trade below $39. 



 
 
 
 


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.

To be notified when this blog is updated :
Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained in herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.


Tuesday, September 13, 2016

Gold Study

 
On the gold chart below, we can easily see that it's typically a good time to buy when the holdings of commercial hedgers, small traders and large traders are all near zero. 



We can also plainly see that currently there's a massive divergence from zero in those metrics.

Disclosure:  We are currently levered short silver via ZSL at an average cost of $27 and levered short gold miners via DUST at an average of $29.60, not previously diarized herein.
 
  
 
 
 
 


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.

To be notified when this blog is updated :
Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained in herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.


Friday, September 09, 2016

TBT Update, 3-year Downtrend Broken, SJB 7-month downtrend broken, VXX & SDOW

 
Today's 400-point drop in the DJIA (-2.26%), while small-caps dropped over 3%, underscores why we seek to hold hedge positions when market conditions warrant it.  
 
We've been stridently bearish on stocks since the start of 2015, especially since May of that year when the DJIA briefly traded above 18300, with a few exceptions when we were short-term bullish during which times markets rallied tremendously.  Otherwise we've insisted on only holding stocks which pay high dividends and did well with that plan, and so too with gold and oil.
 
Below is a 2-year chart of the DJIA, with the red line showing that the DJIA has mostly traded far below the 2015 break-even level and is now back near that level.
 
 
 
We strongly believe it'll trade far below that red line level again, very soon and possibly for a long time to come.  Accordingly we hold SDOW and also VXX, per this posting last month.
 
As stated in that post, since the DJIA closed below 18450 on August 26 the next market day we doubled our VXX at $36.90 and added SDOW at $13.20 
 
We'll stop out of SDOW if it drops to $12.70 and have no stop as yet on VXX.
 
If you too hold these, or are considering them, please be aware of the risk in holding levered 3x instruments such as these, especially on the short side.
 
Never over commit to such holdings.  Never over commit to any holding; long, short, levered or not.
 
 
TBT has broken a nearly 3-year downtrend.  If you don't have it, or wish to buy more, now's the ideal time.  Here's a long-term chart:
 
 

Here's a close-up look at TBT, showing the long-term downtrend broken:
 
 
Per our posting yesterday, we did buy TBT over $32.30, paying $32.35 this morning.
 
Deutsche Bank says 35-year party is over for bond bulls.  This article relates to TBT because, as we've explained in the past, rates set by the Federal Reserve follow rates set by the much bigger bond market, not the other way around as is popularly believed.
 
Note that the "flight to safety of gold" is also largely a myth.  While it's only a single day, it's worth noting that today's market shock resulted in gold going down (-0.7%) not up, and silver dropped big (-2.9%).  Recall that during the market rout of 2008 gold plunged along with the stock market.
 
 
Today SJB crossed above a 7-month downtrend:
 
 
SJB is an instrument for shorting junk bonds.  Read about it here

We went long SJB today at $25.30 


 
 
 
 
 
 
 


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.

To be notified when this blog is updated :
Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained in herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.


Thursday, September 08, 2016

TBT 3-Year Declining Wedge Update

 
Here's an updated look at the ongoing 3-year declining wedge pattern in TBT:



TBT closed today at $31.53. 
 
If trading above $32.30 TBT will be a screaming long-term buy with massive potential in our view.
 
At prices higher than $32.30 it'd be above both the long-term downtrend line shown in the chart above and above the near-term resistance line on the chart shown below:
 
 
 
 
 
 
 
 
 
 
 
 
 
 


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.

To be notified when this blog is updated :
Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained in herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.


Wednesday, August 17, 2016

DJIA Study Update, SDOW, VXX

 
On June 22 we posted this DJIA study

At the time we predicted that if the DJIA pushed much higher "the ultimate high [would be] probably occurring near the lower line on the 'rising wedge'..." 

The DJIA has gone roughly 1000 points higher in the nearly two months since then and is now at the lower line on the 'rising wedge', as seen in this chart:


In light of this potentially pivotal technical juncture we consider this eye-opening article by Mark Hulbert, "Here’s how you know the stock market is hugely overvalued".

If the DJIA closes below 18450 we'll double-up on VXX as well as add SDOW (ProShares Ultrapro Short DOW30). 

If these positions are triggered, we'd close both if the DJIA goes on to close above 18850 pending future updates. 



 
 
 
 
 


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.

To be notified when this blog is updated :
Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained in herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.


Friday, July 01, 2016

Nickel 2-Year Downtrend Broken

 
Below we present a chart of NINI, the iPath Pure Beta Nickel ETN, which shows a 2-year downtrend broken. 



We're long NINI at an average of $16.16, which has not previously been disclosed in this blog nor have we previously commented on nickel or on NINI.
 
In our post last Friday titled "BrExit Market Perspective" we asserted that the "BrExit" vote was a non-event for equities markets, and that "markets may bounce next week". 
 
Those who claimed the 2-day drop after the BrExit vote was a "selling panic" can only fairly call the past three days a "buying panic", however whatever it's called the DJIA indeed bounced big and is now exactly back to where it was before that vote and our DJIA Study of last week still very much applies. 
 
 
 
 
 
 
 
 
 


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.

To be notified when this blog is updated :
Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained in herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.


Friday, June 24, 2016

"Brexit" Market Perspective

 
We offer some perspective on today's purported "market panic".  
 
The DJIA is at the same level it was last Thursday morning, essentially the same level it  closed at 5 weeks ago on May 19, , and at the same level it dropped to mid-day exactly 3 months ago on March 24.  See the chart we posted Wednesday for further reference.
 
On February 11 the DJIA was 1897 points lower than today's close, despite today's 610-point drop.
 
The U.S. dollar is at the same level it was at the start of June, in mid-March, in mid-February, and through most of last year.
 
Gold is at virtually the same level it reached mid-day a week ago.
 
Oil remains higher than most of the past 6 months, and higher than it was just last week.
The euro is at the same level it reached in late May.
 
Lastly, Britain's currency is barely lower than it was in late February.
 
In other words, ignore the fear-mongering hype, because most everything continues to move essentially sideways, and this is not a "buying opportunity", nor are we close to one,  with respect to general equities.  Rest easy knowing we've maintained a bearish outlook all along.
 
Doomsday prognosticators have no idea what the "Brexit" vote truly portends, nor do those who voted either way in the referendum given such a move is unprecedented.  In the long run, nothing much will really change though we'd argue it's a long-overdue step in the right direction.
 
Also bear in mind that the Brexit vote is not legally binding.  Given a mere 1% swing would've resulted in a tie, it would not surprise us to see the referendum results ignored entirely or at least to some degree in the ensuing negotiations to "exit" the European Union.  It does seem like Prime Minister Cameron is respecting the very slight majority vote, for now, however it wouldn't be the first time a politician lied or entirely changed course without warning.
 
What may actually matter for our interests is that the DJIA closed below its 2016 break-even level, though just barely (by 23 points), which is bearish.  That's close enough to call it even, so markets may bounce from that key level next week.  
 
In any case we remain bearish and emphatically maintain that equities remain in a major topping process that will lead to a material and lasting drop in stocks before too long." 
 



 
 
 
 
 


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.

To be notified when this blog is updated :
Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained in herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.


Wednesday, June 22, 2016

DJIA Study, SDOW

 
Keeping in mind our June 16 post "DJIA Quarterly Momentum Chart Update, VXX, Buying SDOW", and the likelihood of this week's "Brexit" vote causing a drastic emotionally-based market swing, we add the following observations.

Here's a long-term chart of the DJIA showing a possible rising wedge pattern broken:


Next we illustrate the resistance level in effect for more than the past year (all-time high was 18351 in mid-May of 2015):


Below is a chart of SDOW.  The red line represents our suggested stop level of "below $14.50";



If the Brexit vote is to "remain", it's expected that there'll be a positive market reaction.  We'd feel very differently, but cannot vote on the matter or make the market go in the direction we feel makes sense.  If markets do jump in response to the vote, it should prove a short-lived rally lasting days or weeks. 

In that scenario, the DJIA would probably approach its resistance level.  It may even exceed it, with the ultimate high probably occurring near the lower line on the "rising wedge" chart at top of the post. 

SDOW would be stopped out and we'd re-enter it once it closes above the black down-trend line shown on its chart above. 



 
 
 
 
 


We receive no remuneration or incentive directly or indirectly in any way, shape, or form for buying or selling the positions we do, or for mentioning any positions or publicly traded companies in this blog. If we hold existing positions we divulge the fact. This blog is merely a diary of some of our thoughts and trades and is in no way whatsoever to be considered investment advice of any kind. Always without fail consult a competent, experienced, and honest broker or investment advisor before making any investment or speculative decisions.

Please presume that we, she, he, I, it, them, they, us and you are purely fictional characters and that everything written in this blog is satire intended for comedic amusement only, and not to be taken seriously in any way. Just like "real" analyst proclamations. Thank you.

To be notified when this blog is updated :
Please e-mail christianguinness@hotmail.com with "Subscribe to blog" in the subject line or click here to do so automatically if your computer is configured accordingly. We have never shared our mailing list with anyone, nor will we. Please note that we only send update notifications when a trade idea is diarized or updated materially, not if a posting only contains general commentary.

This publication has been prepared solely for informational purposes and is made available on an "as is" basis. RidingTheGravyTrain (RtGT) does not make any warranty or representation regarding the information. The material is proprietary and without prior written permission from RtGT it may not be reproduced, copied, modified, performed, published, distributed or broadcast, in whole or in part, in any form, other than for your own personal, non-commercial use.

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, or an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Nothing in these pages constitutes an offer or a solicitation to buy or sell a security nor is it to be construed as investment advice.

RtGT is not an investment advisor. The general opinions and information contained in herein should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional concerning your own situation and any specific investment questions you may have. RtGT cannot guarantee the future performance of any investment.